A Business story Thursday quoted an industry analyst as saying International Business Machines Corp. and Electronic Data Systems Corp. were among the losing bidders for a Department of Veterans Affairs contract. The companies said they had not bid on the contract. (Published 12/22/90)

A Lockheed Missiles & Space Co. subsidiary that had pulled out of the Washington area last summer after failing to win any large government contracts finally won one yesterday.

The unit, Lockheed Integrated Solutions Co. (LISC), was named as lead contractor by the Department of Veterans Affairs on a $153 million project to upgrade the department's nationwide computer network.

The VA contract was only the second government job LISC has won in nearly 2 1/2 years of trying. The other was a $15 million project it won earlier this year. The company closed its 90-person office in Fairfax in July, saying it was reorganizing, and it is now headquartered in Santa Clara, Calif.

In September, LISC's president, former assistant defense secretary Donald Latham, left to join Loral Corp. of New York. Latham's appointment as LISC's president in 1988 had raised its profile and seemed to signal that Lockheed would become a major player in the intensely competitive federal computer systems integration market. However, by last summer, LISC had won only one of the seven contracts it had bid on.

The VA contract will bring LISC back to Washington, but with only a small service office, a company spokesman said yesterday.

The Lockheed unit will be the lead contractor on a project aimed at upgrading the VA's computer system in its administrative offices and 172 hospitals throughout the country. The contract, the largest the agency has awarded in the automated data processing field, runs for one year with options for nine one-year extensions.

LISC "was right on the ropes," said Bob Dornan, a vice president of Federal Sources Inc., which tracks federal computer contracting. "They thought they were going to set the world on fire and nothing happened. People are going to be wondering if they can resurrect themselves now."

A VA spokesman identified only Unisys Corp. as a competitor for the contract, but Dornan said other bidders included International Business Machine Corp., Boeing Co., General Motors Corp.'s Electronic Data Systems division and PRC Inc., a subsidiary of Black & Decker Corp.

"I would consider it a definite feather in Lockheed's cap to beat those guys," Dornan said.

Digital Equipment Corp. is the prime subcontractor on the VA project.

Lockheed is awaiting word on bids for three other big federal contracts from the Internal Revenue Service, National Cancer Institute and the Department of Defense. The first two are expected to be awarded by next spring and the third by 1992.